Church Property – Part 2

A Washington court ruled that a clause in a church deed limiting any future conveyance of the property to “Protestant evangelical churches” was invalidated by state law.

Church Law and Tax 2004-11-01

Church property – Part 2

Key point 7-14. Some deeds to church property contain a “reversion” clause stating that title will revert back to the previous owner in the event that a specified condition occurs. The courts will enforce such provisions, so long as they can do so without interpreting church doctrine.

* A Washington court ruled that a clause in a church deed limiting any future conveyance of the property to “Protestant evangelical churches” was invalidated by state law. A church purchased property in 1956 and received a deed conveying the property “for the perpetual use of Protestant Evangelical Churches” of the community, The church eventually outgrew its facilities, and the congregation voted to sell its property and relocate to a larger facility. The church’s efforts to sell the property to another evangelical church were unsuccessful. As a result, the church wanted to sell its property on the “open market” and build new facilities a few miles away. A state appeals court ruled that the church was free to sell its property on the open market in violation of the deed restriction because of a state law that specifies, “Every provision in a written instrument relating to real property which purports to forbid or restrict the conveyance … thereof to individuals of a specified … creed … is void.” The court concluded that this statute applied to the deed in this case and had the effect of invalidating the restriction, even though the statute was enacted after the deed was written. The court conceded that many other states do not have similar laws, and so deed provisions like the one in this case have been enforced. The state supreme court has agreed to hear this case on appeal. Any developments will be noted in future editions of this newsletter. Niemann v. Vaughn Community Church, 77 P.3d 1208 (Wash. App. 2003).

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